The Graham-Cassidy Health-Care Bill Is a Clear Danger to People with Preëxisting Conditions

The new health-care-reform bill championed by Republicans would affect about fifty-five million people if they got sick, according to the Congressional Budget Office.

Photograph by Alex Brandon / AP

As the Senate gets closer to an expected vote, next week, on the
health-care-reform bill championed by Senators Lindsey Graham and Bill
Cassidy, Republicans—Donald Trump included—are
still claiming that the measure keeps in place protections for people
with preëxisting conditions, while Democrats, health-care experts, and
Jimmy Kimmel are insisting that it doesn’t. (My colleague Ian Crouch has more on Kimmel.)

The draft legislation doesn’t overtly repeal the Affordable Care Act’s
ban on insurers denying coverage to people with preëxisting conditions,
and it doesn’t explicitly abandon the A.C.A.’s community-rating
regulations that prohibit insurers from charging people with serious
illnesses much higher premiums. The bill would, however, allow
individual states to obtain waivers from these rules if they persuaded
the Department of Health and Human Services (H.H.S.) that they could
“maintain access to adequate and affordable coverage for individuals
with pre-existing conditions.” Since the bill doesn’t define what
“access to adequate and affordable coverage” means, critics say that it is
effectively sanctioning a return to the days before the A.C.A., when
sick people in many parts of the country found it extremely difficult
and costly to get health coverage.

Usually, in these types of disputes, the nonpartisan analysts at the
Congressional Budget Office act as the arbiters. When “scoring” a
health-care bill such as Graham-Cassidy, they go through each of its
major proposals and provide numerical estimates of its likely effects.
In this instance, though, the Republicans are exploiting the fact that
the C.B.O. hasn’t had time to do a detailed analysis of their bill—it is
expected to produce just a truncated report before next week’s vote.

But the matter shouldn’t be allowed to rest there. As Sara R. Collins, a
health-care-insurance expert at the Commonwealth Fund, pointed out in a blog post on Wednesday, the C.B.O. analyzed a very similar waiver proposal in May,
and its findings were damning. The agency concluded that about
fifty-five million Americans would end up living in states that would
opt out of the A.C.A. community-rating rules. In these states, the
C.B.O. analysis said, “over time, less healthy individuals (including
those with preexisting or newly acquired medical conditions) would be
unable to purchase comprehensive coverage with premiums close to those
under current law and might not be able to purchase coverage at all.”

The C.B.O. analyzed this proposal as part of its scoring of the American Health Care Act,
the bill that House Speaker Paul Ryan pushed through the House earlier
this year. Some Republicans complained that the A.H.C.A. didn’t go far
enough to dismantle Obamacare, and in May, Tom MacArthur, a New Jersey
Republican, proposed an amendment to the bill that enabled states to
obtain waivers from the A.C.A.’s community-rating rules as long as they
set up subsidized high-risk pools or reinsurance programs to cater to
people with preëxisting conditions. The amendment set aside up to
fifteen billion dollars a year to finance the state-run schemes.

In analyzing this proposal, the C.B.O. conceded that there was a good
deal of uncertainty about how many states would seek a waiver from the
community-rating rules. To decide what each state would do, it looked at
their “past behavior regarding the nongroup market (including the rules
that existed or exist in state law) as well as current market
conditions.” On this basis, the C.B.O. estimated that states containing
about a sixth of the population would obtain waivers. Since there are
about three hundred and thirty million residents of the United States,
this means that about fifty-five million people would be affected if
they were sick, or got sick.

And this might well turn out to be an underestimate. Before the A.C.A.
passed into law, in 2010, only seven states prohibited insurers from
basing their prices on health status: Maine, Massachusetts, New Jersey,
New York, Oregon, Vermont, and Washington. Thirty-three states had no
restrictions at all on so-called medical underwriting. It is perfectly
possible that more of these states could revert to their previous stance
than the C.B.O. anticipates, especially since the Graham-Cassidy bill is
so vague about the sorts of measures they would have to take to obtain a
waiver.

How much more would people with preëxisting conditions in these states
be forced to pay if these waivers were granted? The C.B.O.’s analysis
didn’t say. But other research suggests that premiums would be
prohibitively high, even for people who enrolled in subsidized high-risk
pools. Before the A.C.A. was introduced, thirty-five states operated
these pools, which are targeted at people with actual or potential
health problems. Research by the Commonwealth Fund showed that the premiums for these plans were up to twice as high as those
offered in the regular market, on average. Moreover, the policies only
covered about half of over-all costs. And in fourteen states they came
with annual deductibles of ten thousand dollars or higher.

High-risk pools had other drawbacks. Some of them imposed lifetime
spending caps, a huge problem for people with chronic conditions that
demand expensive care. And most of them refused to cover, at least for a
time, the illnesses that made their enrollees high-risk in the first
place. “Nearly all state high-risk pools excluded coverage of
pre-existing conditions for medically eligible enrollees, usually for
6-12 months,” a report by the Kaiser Family Foundation noted. The report went onto note, dryly,
“This made coverage less attractive for people who needed coverage
specifically for their pre-existing conditions.”

Supporters of the Graham-Cassidy bill argue that things would be
different now, because the high-risk pools would be better financed than
they used to be, and everybody with a preëxisting condition would be
able to obtain affordable coverage. But they haven’t provided any
persuasive analysis to back up this argument, and history suggests that
it is fallacious. Even in subsidized risk pools, insurance is expensive,
incomplete, and hard to come by. Jimmy Kimmel is right: the
Graham-Cassidy bill represents a grave threat to the sick and their
families.